ACC 349 Week 3 DQ 2

What are the differences between variable and absorption costing? Why is variable costing not allowed for GAAP reporting? Which method is more useful for internal decision-making? Why? As a manager, which would you prefer? Why?Absorption costing consists of all costs for a job, including direct materials, direct labor, and both fixed and variable manufacturing overhead. Variable costing only includes direct materials, direct labor, and variable manufacturing overhead for a job. Variable costing is not allowed under GAAP as it does not account for fixed manufacturing overhead costs. However,